Economics 101 & Theology 101

How Should Christians Respond to Economic Uncertainty?

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When economists talk about the free-market economy, they use principles that help explain what may come from certain actions. Their explanations emphasize an element of predictability.

But no one can know exactly what will happen in particular situations since unseen variables can affect outcomes. How should Christians approach the unpredictability inherent in our market economy?

Christians need not fear the unpredictability of the market because of the assurance we have in Christ.

Colossians 1:17 says,

He [Christ] is before all things, and in him all things hold together.

This is not to trivialize the difficulties we face because of market turmoil. Businesses close, jobs are lost, savings disappear. These are all real experiences that have deep, cutting repercussions in people’s lives.

Humans naturally seek to control unpredictability, establish security, and prevent these painful outcomes. It’s in our nature to want to take control.

This is apparent in Genesis 3. Adam and Eve ate the apple in part because they desired to know the unknown. The Bible is filled with story after story of men and women thinking they know best despite God calling them to obedience and trust.

Human attempts to control uncertainty have negative affects in the market, too. Communism at the nation-state level has always begun with intentions to establish security but has led to poverty, oppression, and collapse.

Friedrich Hayek, the Nobel Prize–winning economist, explained why attempts to control economic unpredictability often fail: no one person possesses all the knowledge to prevent that which causes uncertainty in the market. In his essay “The Use of Knowledge In Society,” Hayek writes (emphasis added),

What is the problem we wish to solve when we try to construct a rational economic order?…to put it briefly, it is a problem of the utilization of knowledge which is not given to anyone in its totality.

Economists refer to this lack of information as the knowledge problem. No one person possesses all the knowledge needed to control uncertainty.

Our approach to uncertainty and unpredictability in the market, then, should not be a desire to control driven by fear of the unknown. Hayek’s recognition of the knowledge problem suggests humility as a better approach. As Hayek himself said,

The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.

Humility recognizes what little can be known and controlled. It’s hard to admit that we, by ourselves, can’t solve or fix everything. But this admission isn’t a sign of weakness. It’s an affirmation of our significance.

God has created us with unique knowledge, gifts, and skills. The knowledge I don’t have, you might possess. The problems I can’ t fix, you might have the skills to help, and vice versa. Our uniqueness means we all have a role to play in overcoming uncertainty and the problems it raises.

It’s important to remember that the market’s changing dynamics also allow for new jobs and industries to be created. As history has shown, human flourishing follows when:

Humanity’s God-given creativity means surprising solutions constantly spring up. Unpredictability in the market isn’t always negative—good surprises, solutions no one could have imagined or dreamed of, are a part of the market, too.

The story of the baby carrot is one illustration of surprise in the market. Ugly, full-size carrots were often discarded. Tired of seeing such waste, Mike Yurosek came up with the idea of shaving away the ugly parts and repacking them as a different product: the baby carrot. What was once waste surprisingly became a product of value to shoppers.

Should we put all our faith in the market to end uncertainty? Absolutely not. We should have confidence in our ability to solve problems and meet people’s needs through the market because of the talents and creativity God has given us. Our ultimate faith belongs only in God, who is infallible and justly deserves such honor.

However, just as it is appropriate for Christians to save money or work hard—in other words, acting wisely with the resources we have—it is appropriate to wisely take into account that the market will naturally tend to benefit others.

Knowing that Christ is in control, how then should we act in such an unpredictable world? I think Micah 6:8 provides the answer:

He has showed you, O man, what is good. And what does the LORD require of you? To act justly and to love mercy and to walk humbly with your God.

 

Editor’s note: Learn more about how economics impacts stewardship in Be Fruitful & Multiply: Why Economics Is Necessary for Making God-Pleasing Decisions.

On “Flashback Friday,” we publish some of IFWE’s former posts that are worth revisiting. This post was first published on Feb. 22, 2013,

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